In another blow for the New York Racing Association, state regulators have fined NYRA $10,000 for launching a marketing program before getting state government approval.
The program, in which NYRA mailed out 186,000 "mystery vouchers'' to bettors that could be redeemed at NYRA tracks in amounts ranging from $2 to $1 million, was later cancelled after the state Racing and Wagering Board ordered new safeguards for the program.
The racing board on July 31 criticized NYRA for going forth with the program before being given the green light. State law requires racetracks and off-track betting corporations to have promotional programs approved by the racing board.
The mystery voucher program came under scrutiny in a recent investigation by state Attorney General Eliot Spitzer. He accused crooked tellers of engaging in a long-standing practice of stealing money from customers through various schemes when the mystery vouchers were redeemed.
The racing board then demanded that NYRA institute a series of reforms for the program, including a ban on the placement of date or time stamps on the vouchers. In his investigation, Spitzer said such information was used by corrupt tellers to cheat customers out of their voucher prize money.
The racing board also wanted NYRA to ban racetrack employees from participating in the voucher program and called for improved record-keeping of the vouchers that are mailed out.
NYRA, though, had already mailed out the 186,000 vouchers for a promotion that was set to occur on August 2 in conjunction with the Whitney Handicap (gr. I). It was a part of a nationwide program in conjunction with the National Thoroughbred Racing Association. Unable to meet the board's new demands, it scuttled the program, and said patrons could use the vouchers for free admission to NYRA tracks over the next year.
"They mailed them out before they even applied for our approval,'' said racing board spokesperson Stacy Clifford. She added that while NYRA mailed 186,000 vouchers, it had printed up another 49,600 vouchers that were not mailed out. She said NYRA never provided a satisfactory explanation for what happened to those vouchers.
Clifford said the fine was imposed to cover two separate mailings. She could not immediately say how the $10,000 fine stacked up against other board-imposed fines. The New York City OTB was fined $5,000 earlier this year for opening its parlors on Palm Sunday.
NYRA chairman Barry Schwartz could not immediately be reached for comment. But earlier this month he told the Blood-Horse
that the racing board was harassing NYRA over the mystery voucher program. "Everyone is harassing us, so I guess they jumped on the bandwagon as well,'' he said. He said the racing board never had a complaint in the past over the voucher program.